Landis Received $90,000 Cash and a Capital Asset (Basis of $50,000

question 161

Multiple Choice

Landis received $90,000 cash and a capital asset (basis of $50,000, fair market value of $60,000) in a proportionate liquidating distribution. His basis in his partnership interest was $120,000 prior to the distribution. How much gain or loss does Landis recognize, and what is his basis in the asset received?

• A) $0 gain or loss; $30,000 basis.
• B) $0 gain or loss; $50,000 basis.
• C) $0 gain or loss; $60,000 basis.
• D) $20,000 gain; $50,000 basis.
• E) $30,000 gain; $60,000 basis.

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Definitions:

Individual Demand Curve

A graphical representation of the relationship between the quantity of a good that a single consumer is willing and able to purchase at various prices.

Bandwagon Effect

A psychological phenomenon where individuals do something primarily because other people are doing it, regardless of their own beliefs.

Software Products

Digital applications or systems developed to fulfill particular tasks or to address specific user needs.

Elasticity

A measure in economics that quantifies how a change in one variable, like price, affects the quantity demanded or supplied of a good or service.